Performance & Sustainability Report 2016 ABOUT FIRMENICH ORGANIZATIONAL PROFILE TABLE OF CONTENTS Firmenich is the world’s largest privately owned company in the Chairman and CEO Letter 02 fragrance and flavor business. Founded in 1895 and headquartered in Geneva, Switzerland, R&D Perspectives 04 Firmenich has created many of the world’s best-known perfumes Ingredient Perspectives 04 and flavors enjoyed around the world, every day. Firmenich reports its financial results and sustainability initiatives Perfumery Perspectives 05 (following the GRI guidelines) on a fiscal year basis ending June 30. Flavor Perspectives 06 In this report, all references to “FY16” relate to the 12 months ended June 30, 2016. Sustainability at Firmenich 07 Pathways to Positive 08 6,500 Employees 36 Countries Ethics and Excellence 10 Environment and 18 Resources 25 Manufacturing 3.2bn Swiss francs Innovation, Science 26 sites (CHF) sales and Society Partnerships 32 People and Communities 40 3 R&D centers About this Report 48 OUR WORLD Firmenich operates in three business divisions: Ingredients, Fragrances and Flavors. • The Ingredient Division designs natural and synthetic perfumery and flavoring ingredients. This division was the first created 120 years ago. • The Fragrance Division creates home care, body care and fine fragrances featuring Firmenich molecules and raw materials bought from suppliers. • The Flavor Division crafts flavors used in Sweet Goods, Beverages, and Savory Products. Firmenich’s Flavor Division aims to capture and capitalize on the continued consumer demand for healthier products. As a supplier to the world’s largest consumer goods companies and to a multitude of regional and local customers, Firmenich’s environmental footprint and governance standards matter to our customers. Through our new generation of ingredients, leading delivery systems, ecodesign products and focus on health and wellness as well as hygiene and sanitation, we have anchored sustainability in the long-term interests of employees, local communities, customers and the environment. Firmenich aims to uphold the sustainable development of our industry and the world, with specific targets focused on Ethics and Cover printed on Colorplan Sapphire. Excellence; Environment and Resources; Innovation, Science and Inner printed on Oxygen Offset which is 100% recycled. Society; Partnerships; and People and Communities. Designed and produced by SALTERBAXTER MSLGROUP. Printed by Pureprint. 01 CHAIRMAN AND CEO LETTER Taking their legacy forward, we launched the Building on our partnership with the Bill & Melinda Firmenich Next Generation Research Programs Gates Foundation to “Reinvent the Toilet”, at Stanford University in the United States and the we developed cutting edge malodor counteracting EPFL in Switzerland to advance breakthrough solutions. Recognized as ground-breaking science innovation in sustainability and neurosciences. by Bill Gates and his team at the Bill & Melinda Gates Foundation, our technologies associate our Patrick Firmenich, Vice Chairman of the Board, unique fragrance creation capabilities with was inducted into the Fragrance Foundation’s our deep understanding of olfactive receptors. Circle of Champions in recognition of his extraordinary impact on the fragrance industry. Our creativity stood out at this year’s Fragrance Foundation Awards, as Firmenich won over 20 GLOBAL AND DIVERSE TEAM AND FOOTPRINT accolades around the world. Our leading Culinary Science was also celebrated at the occasion of our This year, we welcomed three new leaders to our unique “Excellence in Plants: from Biology executive team to be part of shaping our future. to Culinary” event. Prof. Geneviève Berger joined us as Chief Research Officer, effective July 1, 2015; Jane Sinclair as INNOVATIVE PARTNERSHIPS General Counsel and Secretary to the Board, in January 2016; and Mieke Van de Capelle as Taking a leading stance on climate change, we Chief Human Resources Officer, on June 1, 2016. actively engaged in the Paris COP21 Summit and signed the Paris Pledge for Action. At this occasion, From left to right: Gilbert Ghostine, CEO; We have a diverse executive team, located across we were elected as co-chair, alongside P&G, of Yves Boisdron, Chairman of the Board all of our main business hubs and firmly dedicated the WBCSD’s1 Cluster for Sustainable Lifestyles. to creating value for our stakeholders around the world. Demonstrating our commitment to responsible sourcing, we launched our Naturals Together Pursuing operational efficiency, we successfully Campaign, sharing how we actively partner across ramped up the automation and capacity of our our value chain to source the best that nature has Perfumery plant in Geneva. Expanding our to offer. Engaging leading sustainability and footprint in high growth markets, we inaugurated traceability practices, our work positively impacts our state-of-the-art plant in Argentina and the lives of more than 250,000 farming families operations in Lagos, Nigeria. To develop our around the world. business in India, we named Satish Rao as our new Country Chairman and Managing Director in this To scale up our impact in this area, we joined the key market. Livelihoods Fund For Family Farming to support sustainable farming practices around the world, PUSHING THE BOUNDARIES along with like-minded visionary partners. A HISTORIC YEAR OF SCIENCE AND CREATIVITY This investment builds on our successful engagement with the Livelihoods Carbon Fund, Fiscal Year 2016 (FY16) was a historic year for Advancing our world-class research and creativity, elected “Best Corporate Offsetting Program” by Firmenich, marked by our 120th Anniversary and Firmenich published 29 patent applications the market in 2016. a number of breakthrough achievements. this year to delight the senses and contribute to greater health and nutrition as well as hygiene As signatories of the United Nations (UN) Global We recorded solid growth, reaching 3.2 billion and sanitation. Compact, we are active champions of its principles Swiss francs (CHF), with an increase of 8.2% in and Sustainable Development Goals (SDGs). local currency. We owe this positive momentum Enriching our portfolio of ingredients, we launched To advance our work in support of the SDGs, we to all of our Business Units (BU) and regions, led AMBROX® SUPER, a highly sustainable and cost- hosted a panel of world experts mobilizing leading by a strong performance in Perfumery, market effective amber note. Building on the success Swiss Companies, including Nestlé, Richemont share gains in Flavors and the solid momentum of CLEARWOOD®, it further anchors our leadership and Crédit Suisse to go further together. of our Ingredients BU. in white biotechnology. Pursuing our vision to develop alternative sources SUSTAINABILITY: PATHWAYS TO POSITIVE 120 YEARS OF PASSION FOR of proteins for greater health and nutrition, DELIGHTING THE SENSES We launched ambitious and industry-leading we advanced our research in biomarine science environmental goals for 2020, supported by a We engaged all of our stakeholders to celebrate to demonstrate the many nutritional benefits CHF 15 million commitment to invest in renewable our 120th Anniversary and legacy of world-class of marine proteins. energy. This year, we also became the first research and creativity, customer intimacy, and Fragrance and Flavor House to use CDP Supply deep sense of social responsibility. To anchor the Chain Climate Change and Water Reporting. spirit of our Founding Fathers as a continuous source of inspiration, we inaugurated the Firmenich Museum in our global headquarters in Geneva, Switzerland. 1 WBCSD : World Business Council for Sustainable Development. 02 Firmenich / Performance and Sustainability Report 2016 We were recognized by a number of prestigious distinctions, including the DuPont “Safety and Sustainability Award 2015” and Ethical Corporation’s “Head of Sustainability of the Year”. As a result of our integrated sustainability strategy, we attained a perfect “100A” score in the CDP Supplier Climate A List, and a “Gold” status with EcoVadis, for our leadership in combating climate change. Our commitment to safety was honored by the New Jersey State Authority for operating for 10 years without any lost-time injuries at our Newark plant. Also, the Swiss Accident Insurance Organization (SUVA) recognized our industry-leading safety performance with their “Excellence Award”. TAKING OUR LEGACY FORWARD Our performance was driven by the trust of our customers, who rely on us every day to help win Board of Directors the hearts of billions of consumers; our industry- leading investment in world-class research and From left to right: Mr. Michel Firmenich, Dr. Antoine Firmenich, Mr. Olivier Bazil, creativity to offer our customers cutting-edge Ms. Barbara Kux, Mr. Yves Boisdron (Chairman), Ms. Karen Jones, Dr. Ajai Puri, Mr. Patrick Firmenich (Vice Chairman), Mr. André Pometta solutions; and the passion and commitment of our colleagues, firmly focused on value creation. We thank you for your interest in our company and our journey of sustainability. We hope that you find this report engaging and informative and that you will gain a real sense of the progress we are making. On behalf of the Board and Executive Committee, we would like to thank all of Firmenich’s 6,500 colleagues for their efforts, energy and the successes that you will read about in this Performance and Sustainability Report. Warmest regards, Gilbert Ghostine Yves Boisdron Chief Executive Officer Chairman